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Rethinking China.s Path of Industrialization

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  • Wu, Harry X.

Abstract

This study shows that China.s post-1949 state-led industrialization has closely followed an underlying path that began in the late nineteenth century. It was initiated by pressing national defence needs and has since been motivated by the same and strong incentives for a faster catch-up with the West despite radical regime shifts. Government determined or influenced resource allocation benefited selected industries and hence nurtured vested interest groups connecting and integrating with the ruling elite, which have strengthened and sustained the path. This means that the path is inherently inefficient which is evidenced by a newly constructed dataset. Reform measures can only temporarily improve efficiency performance, but are unable to break the path in the absence of a genuine political democracy.

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File URL: http://www.wider.unu.edu/stc/repec/pdfs/wp2011/wp2011-076.pdf
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Bibliographic Info

Paper provided by World Institute for Development Economic Research (UNU-WIDER) in its series Working Paper Series with number UNU-WIDER Research Paper WP2011/76.

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Length: 35
Date of creation: 2011
Date of revision:
Handle: RePEc:unu:wpaper:wp2011-76

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Keywords: government engineered industrialization; path dependence; central planning; economic reform; efficiency;

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  1. Syrquin, M. & Chenery, H.B., 1989. "Patterns Of Development, 1950 To 1983," World Bank - Discussion Papers 41, World Bank.
  2. Page, Scott E., 2006. "Path Dependence," International Quarterly Journal of Political Science, now publishers, vol. 1(1), pages 87-115, January.
  3. Carsten A. Holz, 2006. "CHINA's REFORM PERIOD ECONOMIC GROWTH: HOW RELIABLE ARE ANGUS MADDISON's ESTIMATES?," Review of Income and Wealth, International Association for Research in Income and Wealth, vol. 52(1), pages 85-119, 03.
  4. Wang, Lili & Szirmai, Adam, 2012. "Capital inputs in the Chinese economy: Estimates for the total economy, industry and manufacturing," China Economic Review, Elsevier, vol. 23(1), pages 81-104.
  5. Takatoshi Ito & Anne O. Krueger, 1995. "Growth Theories in Light of the East Asian Experience, NBER-EASE Volume 4," NBER Books, National Bureau of Economic Research, Inc, number ito_95-2, October.
  6. Takatoshi Ito & Anne O. Krueger, 1995. "Introduction to "Growth Theories in Light of the East Asian Experience, NBER-EASE volume 4"," NBER Chapters, in: Growth Theories in Light of the East Asian Experience, NBER-EASE Volume 4, pages 1-6 National Bureau of Economic Research, Inc.
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